New Northbrook apartment project hits the market

The developers of a big Northbrook mixed-use project are gearing up for a second payday, putting the property's apartments up for sale after selling its retail space in late 2016.

A joint venture between Chicago-based Morningside Group and Crossroads Development Partners of Schaumburg have hired CBRE to sell NorthShore 770, a 347-unit apartment building next to the Edens Expressway that opened in 2016.

A sale would allow Morningside and Crossroads to exit the project, which includes a 102,000-square-foot Mariano's-anchored shopping center the developers sold for $68.5 million in November 2016.

They've picked a good time to sell, with suburban Chicago apartment rents near record highs and multifamily investors bidding aggressively in the suburbs. Several developers have used the opportunity to cash out of new developments quickly and move on to the next project. In January, a venture led by Chicago developer Golub sold Vantage Oak Park, a 270-unit apartment building in Oak Park that opened in 2016, for $102.8 million.

The CBRE listing for NorthShore 770 does not include an asking price.

New apartment buildings in the northern suburbs have sold for $300,000 to $350,000 a unit in the past two years. In that range, NorthShore 770 would fetch $104 million to $121 million.

"It's going to be one of the strongest per-unit sales in the market just due to the quality of the property," said CBRE Executive Vice President John Jaeger.

A Morningside executive declined to comment.

But the property, at 770 N. Skokie Blvd., is only 77 percent leased, according to a CBRE brochure, which could limit how much investors are willing to bid. Jaeger said he expected the property to be more than 90 percent leased by the time it sells.

With an average rent of $2.56 per square foot, according to CBRE, NorthShore 770 is one of the most expensive apartment buildings in the northern suburbs. Its average effective rent ranges from $1,803 a month for a one-bedroom unit to $3,235 for the most expensive two-bedroom, according to CBRE.

When they broke ground in 2014, NorthShore 770's developers said the project would cost $140 million to build. They financed construction with $105 million in loans.